Swiggy Shares In The Spotlight After Subsidiary Scootsy Logistics Receives ₹1,000 crore Boost

Swiggy's share price is expected to be a focal point on Monday, February 24, 2025, following the company's announcement of a substantial investment in its wholly-owned subsidiary, Scootsy Logistics Pvt Ltd.

On Friday, February 21, 2025, Swiggy disclosed plans to inject up to ₹1,000 crore into Scootsy Logistics through a rights issue, aiming to bolster working capital and fund capital expenditures as part of its business expansion strategy. This move highlights Swiggy's focus on strengthening its supply chain and logistics infrastructure, which is critical to its long-term growth and operational efficiency.

As of 11:30 AM IST, Swiggy Share Price was at ₹363.90, a 0.93% increase from its previous close.

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Details of the Investment

According to the regulatory filing, Swiggy's Board of Directors approved an investment in the equity shares of Scootsy Logistics, amounting to ₹1,000 crore in multiple tranches. The cost of acquisition is ₹7,640 per share, with a premium of ₹7,630 per share or at a price determined based on valuation.

Scootsy Logistics is involved in supply chain services, offering warehouse management, in-warehouse processing, and efficient order fulfillment for wholesalers and retailers. The company plays a key role in ensuring smooth logistics operations, particularly in the quick-commerce and hyperlocal delivery sectors.

The investment aligns with Swiggy's broader strategy to optimize its delivery network, improve last-mile connectivity, and enhance service reliability. By allocating significant funds towards working capital and capital expenditure, Swiggy aims to gain a competitive edge over rivals like Zomato and Blinkit.

Swiggy Stock Price Performance

Despite this strategic move, Swiggy’s stock has struggled in the market. The share price has declined by 18% over the past month and 33.5% on a year-to-date basis. Notably, the shares have slipped below their IPO issue price of ₹390 and listing price of ₹420. On Friday, February 21, 2025, Swiggy shares closed at ₹360.70 apiece on the BSE, marking a 3.47% decline for the day.

Swiggy made its public market debut on November 13, 2024, at ₹420 per share, reflecting a modest 7.7% premium over its issue price. However, the stock has since faced downward pressure due to concerns over profitability, intense competition, and overall market sentiment toward new-age tech companies.

Market Outlook and Investor Sentiment

Market analysts believe that Swiggy’s investment in Scootsy Logistics is a strategic step toward long-term sustainability. Efficient logistics operations are crucial in the competitive food and grocery delivery space, where faster deliveries and cost efficiencies determine market leadership.

However, investors remain cautious, given the stock’s recent underperformance. Swiggy will need to demonstrate improved financials and operational efficiency to regain investor confidence. Analysts suggest that the upcoming quarters will be critical in assessing the impact of this investment on Swiggy’s bottom line.

With increasing demand for quick-commerce services, Swiggy’s focus on logistics expansion could prove beneficial in the long run. Investors and market watchers will be keenly observing how the ₹1,000 crore investment translates into growth and profitability for the company.